Operations Management at Morrisons Company - Case Study Example

Analysis of Operations Management By Student Name Course Code + name University Name City, name Date PART A Operations and Corporate social responsibility (CSR) Corporate social responsibility is not entirely a new concept in the field of business. In fact, the concept has been in existence over the past few decades. CSR involves the behavior of organizations regarding their association with the relevant stakeholders. Various organizations and researchers have undertaken studies aimed at providing clear understanding of the CSR concept. The question always arises of whether organizations have social obligations to their stakeholders and if yes to what extent (Kercher, 2007). In particular, the discussion on CSR focuses more on large organizations such as MNCs, due to the nature of their size. Researchers believe that large organizations have a significant impact on their stakeholders. Research shows increased operations involving CSR owing to several factors. Globalization is one of the aspects leading to broader perspective about the role of CSR. With the rising global trend in the corporate world, it is obvious that the business’ activities are likely to cause more impact on the stakeholders. Globalization presents an opportunity for Companies to broaden their operations such as increased production and marketing (Broomhill, 2007). The potential effects of MNCs’ activities due to increased globalization have prompted the need to adjust the concept of CSR. Researchers agree that, businesses are now considering CSR concept from a global perspective. Operations involving CSR have also increased following improvement in communication systems. Various stakeholders are now able to examine corporate activities and in particular, the ones having a direct impact on them. Further, various stakeholders are now showing more interest regarding organizations’ activities (Smith, 2011). There are emerging concerns over the way businesses conduct their activities and the measures they take to minimize risks and other social issues. International organizations such as the UN are also monitoring the activities of businesses. The organizations aim at ensuring that Companies do not violate their corporate social conduct. Initially, there were no strict regulations towards business’ activities, but currently there is a lot of monitoring of various business operations. The increased screening of business operations has completely altered the way firms conduct their operations, especially regarding CSR. Opportunities The growing operations involving CSR presents great opportunities for business growth. Organizations that will embrace the changing trends in CSR are likely to encounter tremendous opportunities, especially in the global market. Improved CSR operations are likely to result in the establishment of competent Human Resource team. Human Resource Department plays an important role in the success of a business (Broomhill, 2007). It is important for businesses to ensure that they establish a qualified human resource team. For businesses to be able to create a strong human resource team, it is important to consider their CSR operations. In particular, firms should improve on how they relate to their employees. The way a firm conducts itself about its employees determines the impact that the employees will have on the firm. Poor relations with the employees results in a poor performance of the business. On the other hand, if employees are well treated, then the business is likely to perform better. Further, CSR operations should not only focus on the existing employees, but also on potential employees. Companies have an opportunity to depict a good picture to their potential employees by engaging in proper CSR operations. Adoption of appropriate CSR operations also presents an opportunity for businesses to manage their risks. Organizations take years to build a good reputation; however, all this can be lost within hours. Unethical behavior or action taken by a firm may lead loss of a hard earned reputation. Some of the unethical actions may involve corruption and issues affecting the environment such as pollution. Companies, therefore, need to ensure that they uphold integrity at all times, and this way they are will be able to deal with potential risks. Adherence to set regulations is another opportunity presented by engaging in appropriate CSR operations. No compliance with the set rules and regulations often result in interference with the business operations. Therefore, firms should avoid such interferences by ensuring that they comply with the set regulations. Compliance with the regulations also creates public confidence towards the firm. Both the governing authority and the public develop a different perception of the business. As a result of complying with the regulations, the business can avoid excessive supervision by the government and. Therefore, it can operate independently. Challenges Despite, the tremendous impact of CSR on the stakeholders, there still exist questions on the role of CSR operations regarding the objectives of a firm. Critics are still in doubt on whether CSR is a cost or a benefit to the Business. Further, the critics argue that there lack sufficient studies to ascertain the cost involved in carrying various CSR operations (Clarke, &Klettner, 2009). There is also the issue of sustainability of the CSR activities. There are growing concerns about whether organizations have the necessary resources to maintain CSR operations in the long run. CSR operations also put the loyalty of the management at risk. The role of management is to meet the interests of the shareholders through profit maximization. However, management also has responsibility towards the stakeholders. Therefore, managers must be able to strike a balance between meeting the interests of both shareholders and stakeholders. In some cases, managers are likely to focus more on meeting the interests of stakeholders (Clarke, &Klettner, 2009). It usually happens when managers want to build their reputation; however, they do so at the expense of the shareholders’ interests. The question of whether CSR should be regulated or voluntary also poses a challenge to the development of CSR operations. Research shows that different organizations and institutions are in support of self-regulated CSR operations (Smith, 2011). Companies should be given an opportunity to decide their CSR activities and to go about it. However, there are rising concerns over the firms’ willingness to undertake CSR voluntarily. PART B Morrisons’ Company Introduction: Background Morrisons Company is one of the high street retailers in the UK operating over five hundred stores. Apart from physical delivery, the Company also operates an online delivery service. The business mainly deals with the provision of fresh food and grocery. The Company has its manufacturing plant where all the food processing activities takes place. The presence of a production facility gives the Company the commanding power regarding the quality of its products. Further, the firm can employ professionals thus ensuring production of high-quality products.The report shows that Morrisons’ business has one of the best workers compared to other retail stores (Hofstede et al., 2007). The Company has employed over one hundred thousand workers who work tirelessly to ensure customer satisfaction. The firm serves an average of eleven million customers on a weekly basis. To achieve more efficiency at individual stores as well as in the broader distribution network, the business undertook an overhaul of some of its operations. For instance, the firm changed its entire information technology system. The adoption of new technology in the business’ operations widened its scope in the market (Krajewski et al., 2015). Further, the firm has high growth potential owing to the new technology. Morrisons’ Operations Transformation Process The Company has undertaken various operations transformation process aimed at improving its overall performance in the market. One of the major transformation processes involved replacement of the entire information technology system(Anupindi et al., 2011). The replacement of old IT system with a new one greatly improved the efficiency of the business’ operations. With the adoption of the new technology, the firm can produce more quality products at a relatively low cost. The new technology further enhances communication. Communication is very important to the success of a business. Companies use communication channels to pass information across different production sections. Effective communication channels, therefore, ensure that information reaches its destination on time. Further, organizations use communication channels to create awareness about their products to the public. With improved information system, Morrison’s Company was able to communicate with its target customers about their products. The Company also adopted new channels of distribution, and this increased the quantity of products distribution (Anupindi et al., 2011). Customers now had access to more products. It is always important to ensure that customers have enough products regarding quantity. Finally, the business also managed to increase the variety of its products by changing the production processes. Customers now have enough product varieties to choose. Trade-Off Analysis among the Operations Performance Objectives Cost Cost plays an important role in determining the performance of a business. Organizations that can control their cost of production are more likely to succeed compared to those that are not able to manage their production costs. Businesses need to establish a trade-off between their cost and the amount of products they sell. Low-cost products lead to increased sale quantity. In the case of Morrisons, the Company can sell more products since it sells its products at affordable prices (Calabrese, 2012). Quality The quality of products and services offered by Morrisons align with its customers’ satisfaction level. If customers are not satisfied, they may decide to consume products from other retail shops, and this would have a negative impact on Morrisons’ income. However, the business has the freedom to either reduce or increase the quality of its products (Calabrese, 2012). Cost plays a significant role in determining the quality of products. If the Company decides to produce quality products/services, then it has to incur a high cost. The increased cost of production further leads to increasing in the price of the products/service. Speed Speed is an essential attribute, especially in the distribution process. Naturally, customers always demand speed in the provision of products/ services. Following the large customer base of Morrisons, the business has no choice but to improve its speed. However, increased speed means more workers and hence more cost. Therefore, the firm will have to forgo some revenue in the form of cost so as to increase its speed. Dependability A business should be able to create a platform where its customers can totally depend on it. Morrisons’ business has managed to create customer dependability; however, the business must ready to keep up the changing customers’ demands. Flexibility Morrisons provides its customers with products that are standardized and thus does give room for flexibility. It is not possible for the operations manager to overcome any of the above trade-offs since they are interdependent. Recommendations I think it’s important for Morrisons business to rethink on the issue of flexibility. It is important to allow customers an opportunity to decide the combination of products they want. Standardization creates a limitation and customers are not able to decide on their own (Slack et al., 2013). Operations and CSR of Morrisons’Company The business regards the operations involving CSR highly. Research indicates that the Company considers the social, ethical and environmental issues as very significant. The firm has established a committee whose core mandate is to oversee the CSR operations relating to the Company. The Company through the committee has undertaken several social activities such minimizing wastage to the environment and provision of employment opportunities for over one hundred thousand people (Garriga&Melé, 2013). The Company also ensures the provision of safe food products to its customers. Also, the firm ensures the provision of quality products to its customers at an affordable price. Conclusion From the above discussion, it is evident that Morrisons’ business applies various operation management techniques. One of the techniques mentioned is the operations performance process, where the Company employs modern technology to improve efficiency in its production process. Trade-off analysis is another technique applied by the Company to ensure balancing between various performance objectives such as cost and quality. Bibliography Anupindi, R., Chopra, S., Deshmukh, S. D., Van Mieghem, J. A., and Zemel, E., 2011, “Managing business process flows,” Pearson Higher Ed. Broomhill, R., 2007, “Corporate Socal Responsibility: Key Issues and Debates,” Don Dunstan Foundation. Calabrese, A., 2012, “Service productivity and service quality: A necessary trade-off?,” International Journal of Production Economics, 135(2), 800-812. Clarke, T., andKlettner, A., 2009, “ Implementing Corporate Social Responsibility: A Creative Tension Between Regulation and Corporate Initiatives,”  Global Perspectives on Corporate Governance and CSR, Ashgate, Surrey: Gower Publishing, 269-312. Garriga, E., and Melé, D., 2013, “Corporate social responsibility theories: Mapping the territory,” In Citation Classics from the Journal of Business Ethics(pp. 69-96). Springer Netherlands. Hofstede, A., van Hoof, J., Walenberg, N., and de Jong, M., 2007, “ Projective techniques for brand image research: Two personification-based methods explored,” Qualitative Market Research: An International Journal, 10(3), 300-309. 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